"Netflix Inc. the world's largest video-subscription service, said customer growth will slow after posting first-quarter gains that met analysts' estimates. The stock fell as much as 16 percent in extended trading.

Netflix, based in Los Gatos, California, added 1.74 million new U.S. online subscribers to reach 23.4 million, the company said today on its website. That matched the average of nine analysts' estimates compiled by Bloomberg. Second-quarter growth will slow by at least half and probably more.

Chief Executive Officer Reed Hastings, presiding over the first loss since early 2005, cited higher seasonal customer turnover for the slowdown. The company is racing to add viewers to confront competition from Comcast Corp.'s StreamPix and Verizon Communication Inc. (VZ)'s online venture with Coinstar Inc. (CSTR)'s Redbox. While Netflix may post a second-quarter profit, investors are focused on subscriber additions.

"They guided to subscriber growth dropping a ton quarter- over-quarter, and some people think as soon as growth stops, this thing's over," said Michael Pachter, a Wedbush Securities Inc. analyst in Los Angeles who has an underperform or sell rating on the stock. "They are saying, 'We're not going to grow very much and instead we're going to focus on making money. "

"The year is 1847 and Reed Hastings, CEO of Netflix (NFLX), is out in California mining gold. It oozes to the surface and efficiently he picks up the nuggets, re-investing profits into new mining equipment. Wiping the sweat off his brow, he looks around the valley below on this hot day. It's virtually untouched, as few understand what he does, and how much wealth there is hidden in these hills.

Fast forward s few years later, the Valley is now called Silicon, and huge titans of the industry are moving in. Amazon (AMZN), Google (GOOG), Apple (AAPL), Verizon (VZ), Coinstar (CSTR), Time Warner (TWX), Comcast (CMCSA), and Walmart (WMT) all want a piece of Netflix's profits. Reed Hastings has a dilemma on his hands. Suddenly machinery (content) is costing a tremendous amount more as rivals are bidding up the prices of a seemingly limited amount of the tools needed to extract gold. "